What is a winding up order?

Are you owed money by a company that you have been unable to recover following the issue of a statutory demand? You may wish to consider issuing a winding up petition.

A winding-up order is a court order that leads to the compulsory liquidation of a company. It is a legal process through which the assets of a company are realised and distributed to its creditors in order to settle its debts. The winding-up order is typically sought by a creditor, the company itself, or a government authority, and it marks the beginning of the end for the company.

How to issue a winding up order

Listed below is an overview on how to issue a winding up order

Issuing a winding-up order for a limited company involves a series of legal steps. Here is a step-by-step guide, incorporating the provided keywords:

Statutory demand:

Before issuing a petition, a creditor may serve a statutory demand to the company, demanding payment of the outstanding debt. This serves as a formal notice of the debt owed.

Winding-up petition:

If the company fails to pay the debt specified in the statutory demand, the creditor can proceed to issue a winding-up petition. This petition is a formal request to the court for the compulsory liquidation of the company.

Once the winding-up petition has been prepared, it must be served on the company. This involves delivering a copy of the petition to the company’s registered office.

Apply to the Court:

When the petition has been served, the petitioner applies to the court, seeking a hearing for the winding-up petition. The court will then decide whether to grant the petition based on the presented evidence.

Order Is Granted:

If the court is satisfied that the company is insolvent and the winding-up petition is justified, it may grant a winding-up order. This order marks the beginning of compulsory liquidation.

Licensed Insolvency Practitioners:

The court may appoint an official receiver or a licensed insolvency practitioner as the liquidator. These professionals will take control of the company’s assets and oversee the liquidation process.

The liquidator gains control of the company’s bank accounts and other assets to begin the process of realising funds to pay off creditors.

Compulsory Liquidation:

With the winding-up order in place, the company enters compulsory liquidation, and its affairs are wound up in an orderly manner. The liquidator works to settle outstanding debts and distribute remaining assets among creditors.

Notice of the winding-up order is published in the London Gazette. This serves as a public record and provides notice to all interested parties.

The company director’s powers cease upon the issuance of the winding-up order, and they no longer have control over the company’s affairs.

The winding-up order and relevant details are also registered at Companies House, further documenting the company’s status.

The court, having granted the winding-up order, oversees the closure of the company, ensuring that all legal requirements are met in the liquidation process.

It’s crucial to note that the process outlined above involves legal complexities, and it is advisable to seek professional advice from legal experts or licensed insolvency practitioners when considering or pursuing the winding-up of a company.

Can a winding up petition be challenged?

A business that has received a winding up petition can dispute the same. When a winding-up petition is presented to the court, the company has the opportunity to challenge it and provide reasons why the petition should not be granted

How can ARC Costs assist?

ARC Costs can assist will all aspects of claiming or defending winding up petition costs.

ARC Costs are a team of independent and experienced Costs Draftsmen and Costs Lawyers who regularly assist you in the recovery/contention of costs.

Whether you are the Paying Party or the Receiving Party, we hold vast experience in dealing with costs matters on both sides.

We can assist in fixed recoverable costs cases and cases where costs are awarded on the standard basis, including the preparation/challenging of Bills of Costs, conducting of detailed assessment proceedings, and the preparation of Points of Dispute/Reply.

Should you require our assistance or have any further queries regarding costs, please contact us on 01204 397 302 or email one of the team at info@arccosts.co.uk. Alternatively, please complete our online enquiry form, and we will contact you to discuss your query or speak to our staff using the live chat function.

If you would like more information on how to issue a winding up order, ARC Costs also maintain an extensive legal network of expert Solicitors in this area, and we would be happy to pass on your details to assist.

We may receive payments from third party solicitors on our panel to whom we may refer your claim. We will never charge you for any referrals made to our panel of third parties.